Fartcoin Flash Crash Exposes Hyperliquid to $1.5M Hit From Coordinated Attack

 A coordinated attack on Hyperliquid left HLP down $1.5M as Fartcoin crashed 26% after a 57% rally, tied to the same team behind XPL’s April 3 collapse.

Fartcoin had been climbing for three straight days. A 57% surge pushed it to a high of $0.252 by April 9, drawing in bulls chasing momentum. Then 7:00 a.m. hit. The token dropped more than 20% in five minutes flat.

By the time it bottomed below $0.18, the crash had wiped out most of what the rally built. The total decline landed above 26%, and the damage did not stop at the spot market.

The Trap Was Already Set

According to PeckShieldAlert on X, Hyperliquid’s HLP pool absorbed roughly $1.5 million in losses within 24 hours. The attacker had quietly built a $15 million Fartcoin long position across four wallets, accumulating 145.24 million tokens before the crash unfolded.

The setup was deliberate. In a low-liquidity environment, the attacker triggered what PeckShieldAlert described as a “suicide” liquidation, forcing Hyperliquid’s auto-deleveraging mechanism to activate. HLP was left holding the toxic position. The paper loss sat around $3 million, but cross-venue hedging likely made it a profitable operation overall.

That part is key. The loss was on Hyperliquid’s side. The attacker walked away.

This Team Has Done This Before

On-chain data firm Lookonchain flagged the incident and drew a direct connection to the April 3 XPL collapse. Two addresses, 0xBc1D9760bd6ca468CA9fB5Ff2CFbEAC35d86c973 and 0x3dBE077e7986657E95e1CC50089f17a5a4AF0AaE, link both events. The Fartcoin accumulation started shortly after the XPL flash crash, suggesting the same group pivoted operations almost immediately.

Lookonchain outlined the playbook used in both cases. Before the rally, multiple addresses funneled funds into Hyperliquid to open high-leverage long positions. After locking in gains, the team withdrew all margin, moving their liquidation prices to near-bankruptcy levels. Then, coordinated spot selling across multiple platforms triggered crashes in both spot and futures simultaneously.

At exactly 7:00 a.m., six addresses withdrew funds at the same time. All hit the same liquidation level near $0.22. The resulting batch liquidations totalled $22.83 million and sparked the flash crash directly.

Whales Who Chased the Rally Got Wiped Out

The collateral damage was substantial. Lookonchain reported that large trading addresses holding positions worth over $1 million were collectively liquidated for $38.88 million. These were traders who followed the rally upward without seeing what was waiting at the top.

Within about an hour post-crash, two additional addresses, 0x5e1 and 0x71c, opened fresh high-leverage longs with tight liquidation levels. Both were fully liquidated at 7:52 a.m., pushing the token lower again. Those addresses trace back to 0xBc1D, the same source wallet connected to the wider operation.

The Hyperliquid vulnerability in low-liquidity tokens is not new. Prior incidents involving the platform’s ADL mechanism have drawn scrutiny before. This time the losses fell on HLP, the pool that acts as counterparty for liquidations the system cannot otherwise handle.

Bad debt was created. The platform absorbed it.

The Number Behind the Numbers

The $1.5 million HLP figure is the direct hit. The $38.88 million in liquidated whale positions is the wider fallout. And the $3 million paper loss for the attacker becomes a probable net gain once cross-venue short positions are factored in.

Fartcoin, for context, had surged 57% over three days before the collapse. The 3-day gain and the single-morning wipeout now sit in the same chart. That is the setup: build the rally, bait the chasers, destroy the price, profit from the short.

The same team, the same method. XPL on April 3. Fartcoin on April 9.

Disclaimer: This article is based on on-chain data and publicly available sources. It does not constitute financial or investment advice. Price analysis and observations represent the writer’s interpretation of available data.

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